Sunni Islamist insurgents took over parts of a town in northern Iraq on Thursday, local officials said, gaining further ground against the Shi'ite-led government in Baghdad, which has also lost control of another city.

The mayor of Sulaiman Pek said the militants belonged to the Islamic State in Iraq and the Levant (ISIL), a Sunni group that was involved in the takeover of the city of Falluja last month and is also active in neighbouring Syria.

”We are still inside the government building in the town center surrounded by the gunmen. They are attacking us with rocket-propelled grenades and machine guns,” mayor Talib Mohammed said. “They are from the Islamic State of Iraq: we know them from the black flags they are flying... We demand the government intervene to help us.

Sunni Islamist insurgents, including ISIL, have been regaining ground in Iraq over the past year, but the takeover of Falluja on January 1 marks the first time they have openly held territory in years.

Sulaiman Pek, located 160 km (100 miles) north of Baghdad, has a population of around 25,000 people, of which the majority is Sunni Arab, with smaller Turkoman and Kurdish communities.

”We woke up this morning to mosque loudspeakers announcing that the Islamic State of Iraq and [the] Levant is controlling the town and demanding residents to leave their houses,” local official Ahmed Aziz said.

”Most of the families are leaving the city fearing... a bloody battle,” he added.